WHY CHRISTMAS TREES COULD BE MORE EXPENSIVE THIS YEAR

"We are optimistic that everybody who buys real Christmas trees will still be able to find a real Christmas tree this year of their liking."

Author:
Shen Lu, MagnifyMoney , TEGNA

Published:
7:55 AM EST November 16, 2017

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If you plan to buy a fresh Christmas tree this holiday season, you might want to leave a bit more wiggle room in your budget.

The National Christmas Tree Association, which represents more than 700 member farms, estimates that the prices for U.S.-grown Christmas trees will rise 5 to 10 percent this year because supply is tighter than usual. The tree species impacted will be farm-grown Noble and Fraser firs, which are most popular around the holidays.

The good news is that although prices are increasing, finding a tree isn’t expected to be a big problem.

“We are optimistic that everybody who buys real Christmas trees will still be able to find a real Christmas tree this year of their liking,” Doug Hundley, a spokesman for the association, told MagnifyMoney.

Local tree sellers are already seeing evidence of pricier trees this season. Popi Costa, a sales rep at U S Evergreens, a wholesale florist based in New York City’s Flower District, says the store is still awaiting its shipment of Christmas trees, but other decorative Christmas evergreen items, such as the branches used to make wreaths, have already arrived and are 5 percent more expensive than usual.

U S Evergreens sources all of its Christmas evergreens from farms in Oregon, the biggest Christmas tree producer in the nation.

“We haven’t received the price list yet, but we think it will be a little bit more than it was before,” Costa says.

What’s behind the price uptick?

The price increase of Christmas trees is actually one of the far-reaching consequences of the Great Recession. For a few years following the financial crisis, Christmas trees prices fell as cash-strapped consumers bought fewer trees than were available on the market.

As a result, the revenue stream that growers would typically use to fund following year’s harvest was depleted, leading farms to plant fewer new trees. Another reason is that there have been fewer seedlings — young plants grown from seeds that are later sold to farms — available for farms that rely on them to jumpstart their planting.

Now, consider the seven to 10 years it takes to produce a mature tree of six or seven feet. No wonder we’ve ended up with a supply issue of holiday-ready trees. As the demand catches up during the economic recovery, the price go up.

Although there are fewer trees available, Hundley says there should be more than enough evergreens available to meet demand.

However, if you prefer a specific type of Christmas tree, he encourages you to purchase as early as possible — he suggests shopping no later than the week after Thanksgiving. A typical fresh Christmas trees lasts for about a month if properly cared for.

America’s love for Christmas trees: By the numbers

According to the tree association, some 350 million Christmas trees are currently growing on thousands of family farms across the country to meet the demand for a decade to come. The top three Christmas tree-producing states are Oregon, North Carolina and Michigan.

Hundley, who has been in the industry for more than three decades, says when the economy is improving, people often buy bigger Christmas trees. He said growers are expecting the same demand for the coming sales season, if not larger, with Americans in general feeling better about the economy.

Consumer confidence has risen to its highest level in almost 17 years, according to data released last week through The Conference Board, a global, independent business membership and research association.

Another tree trend to watch: Americans are slowly swapping out the real thing for fake trees, data show.

The number of real Christmas trees purchased in 2016 was 27.4 million, down from a recent peak of 33 million in 2013, according to the National Christmas Tree Association.